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At The Southern Credit Union, we want you to keep more of what you earn. Let us answer your questions!

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Choose a Mortgage question below

How do I know how much house I can afford?

 Generally speaking, you can purchase a home with a value of two or three times your annual household income. However, the amount that you can borrow will also depend upon your employment history, credit history, current savings and debts, and the amount of down payment you are willing to make. You may also be able to take advantage of special loan programs for first time buyers to purchase a home with a higher value. Give us a call, and we can help you determine exactly how much you can afford.

What is the difference between a fixed-rate loan and an adjustable-rate loan?

 With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM loan will likely change. There are advantages and disadvantages to each type of mortgage, and the best way to select a loan product is by talking to us.

How do I know which type of mortgage is best for me?

 There is no simple formula to determine the type of mortgage that is best for you. This choice depends on a number of factors, including your current financial picture and how long you intend to keep your house. The Southern Credit Union can help you evaluate your choices and help you make the most appropriate decision.

What does my mortgage payment include?

 For most homeowners, the monthly mortgage payments include three separate parts:

  • Principal: Repayment on the amount borrowed
  • Interest: Payment to the lender for the amount borrowed
  • Taxes & Insurance: Monthly payments are normally made into a special escrow account for items like hazard insurance and property taxes. This feature is sometimes optional, in which case the fees will be paid by you directly to the County Tax Assessor and property insurance company.
  • Mortgage Insurance: If you loan exceeds over 80% loan to value, private mortgage insurance will be required

How much cash will I need to purchase a home?

The amount of cash that is necessary depends on a number of items. Generally speaking, though, you will need to supply:

  • Earnest Money: The deposit that is supplied when you make an offer on the house
  • Down Payment: A percentage of the cost of the home that is due at settlement
  • Closing Costs: Costs associated with processing paperwork to purchase or refinance a house 

What does Pre-Qualification mean?

 A preliminary assessment of a buyer’s ability to secure a loan, based on a specific set of lending guidelines and buyer representations made. This is not a guarantee or commitment by a lender to extend credit.

What is a Pre-Approval?

 A commitment by a lender to extend credit provided that specific conditions are met.

What is needed to apply for a mortgage?

 You will need to provide basic information about your income, assets, monthly expenses and any other properties you own. And as a reminder, before you fill out your application, be sure to temporarily lift any credit freezes you have in place at least for 72 hours or more.

What is an Escrow Account?

 Generally, a portion of the monthly mortgage payment is held in an “escrow account” by the lender to pay for the yearly property taxes and homeowners insurance premiums.

What is an APR?

 The Annual Percentage Rate refers to the total cost of the loan, expressed as a yearly rate. Some (not all) of the fees you’re charged along with the interest are included in the calculation. The APR is an effective interest rate – not the actual interest rate. Your monthly payments will be based on the actual interest rate, the amount you borrow and the term of the loan.

What are the Closing Costs for a purchase transaction and how are they calculated?

 Expenses (over and above the price of the property) incurred by buyers and sellers in transferring ownership of a property. Also called “settlement costs”. They are usually determined by the size of the loan.

Can I roll in my closing costs on my mortgage loan?

 Yes you may include your closing into your refi and can NOT with a purchase.

In a purchase transaction, can the seller pay my closing costs?

 Most loan programs allow seller contributions to closing. please contact us for details 770.719.1111.

What is PMI and do I have to have it?

 Insurance written by a private company to protect the lender against loss caused by mortgage default. If you finance over 80% of the value of the property, you may have to purchase PMI.

Does The Southern offer FHA loans?

Yes, call us at 770.719.1111 or 800.338.5882 and speak with a Mortgage Representative. 

What is an Intangibles Tax?

 A tax emposed by the State of Georgia for the amont financed on purchase transactions. This tax is at a rate of $3.00 per $1000 based on the amount financed. You are exempt from this tax by being a member of a credit union in Georgia.

Fixed Rate Mortgage

Choose a Fixed Rate Mortgage question below

Should I get pre-qualifed before I start shopping?

 Yes, it is a good idea to get pre-qualified so you have an idea of what you can afford - A quick conversation with your lender about your income, assets and down payment is all it takes. Call us today at 770.719.1111 or 800.338.5882.

What does a typical monthly mortgage payment include?

  • Principal
  • Interest
  • Homeowner’s insurance
  • Property taxes
  • Private mortgage insurance (PMI), if you put less than 20% down on your home

If you want to pay more on your mortgage, be sure to specify you want any extra money to go toward the principal only, not an advance payment that prepays interest.

* Some properties require a monthly association fee. 

Adjustable Rate Mortgage (ARM)

When should you consider an adjustable rate mortgage?

 An ARM with a lower initial rate could be a better (and cheaper) way to go if you know that you are planning on living in a home for a short period of time (1-10 years).

What are the popular adjustable rate mortgages The Southern offers?

 There are several different types of adjustable rate mortgages, and they are often represented numerically (e.g., 5/1 or 10/1). The first number indicates how long your initial fixed-rate period will last. The second number indicates how often the rate can change within the 30 year term. Some of the most common ARM loans include:

  • 5/1 ARM: A 5/1 ARM loan has a fixed rate of interest for the first 5 years of the loan.
    After that, the interest rate will adjust once annually over the remaining 25 years.
  • 7/1 ARM: A 7/1 ARM loan has a fixed rate of interest for the first 7 years of the loan.
    After that, the interest rate will adjust once annually over the remaining 23 years.
  • 10/1 ARM: A 10/1 ARM loan has a fixed rate of interest for the first 10 years of the loan.
    After that, the interest rate will adjust once annually over the remaining 20 years.
  • 5/5 ARM: A 5/5 ARM loan has a fixed rate of interest for the first 5 years of the loan.
    After that, the interest rate will adjust once annually every 5 years over the remaining 25 years.
  • 10/5 ARM: A 10/5 ARM loan has a fixed rate of interest for the first 10 years of the loan.
    After that, the interest rate will adjust once annually every 5 years over the remaining 20 years.
  • 15/5 ARM: A 15/5 ARM loan has a fixed rate of interest for the first 15 years of the loan.
    After that, the interest rate will adjust once annually every 5 years over the remaining 15 years.

How is an index and margin used in an ARM?

 An index is an economic indicator that lenders use to set the interest rate for an ARM. Generally the interest rate that you pay is a combination of the index rate and a pre-specified margin.

Closed-end Fixed Rate Second Mortgage

Choose a Fixed Rate Second Mortgage question below

What are some uses for a Closed-end fixed rate second mortgage?

 Home renovations, fund debt relief, help with college expenses and medical bills.

Why should I choose a closed-end fixed rate second mortgage over a personal signature loan?

  • You will be able to take adv of the equity you have built in your home
  • Longer loan term means lower payments
  • Potential tax advantages,
  • Lower interest rates
  • Higher loan amounts

Are there any tax benefits to choosing a Closed-end Fixed Rate Second Mortgage?

 There may be tax advantages. The mortgage interest paid may be tax deductible. Please speak with a tax professional for details.

Mortgage Refinance

Choose a Mortgage Refinance question below

When should you refinance your house?

 If your mortgage has a higher interest rate compared to ones in the current market, then refinancing could be a smart financial move if it lowers your interest rate or shortens your payment schedule.

Should i refinance if i can reduce my rate less than 1%?

 Maybe. There are several factors to look consider. Loan balance and term remaining are key factors to making that decision. Allows us to provide consultation to help answer your questions. 770.719.1111

I would like to refinance my first mortgage and borrow some of the equity I currently have in my home. How can I do this?

 The first step is to evaluate your financial situation and start an application. This allow us to properly evaluate options and present you a plan, please call today to get started.

Land Loan

Choose a Land Loan question below

How much of a down payment do I need for a Land Loan?

 Typically you can expect to need 25% down.

What is the minimum number of acres you will finance?

 We do not have a minimum acreage requirement but our maximum acreage loan is 20 contiguous acres.

What if I decide to build on the land? Do you offer construction loans?

 We are currently not offering construction loans at this time.

Should I get pre-qualified before beginning my land search?

 It is not required but it is a good idea and it’s becoming more common. Being pre-qualified going into the search has several benefits. It gives you a good idea what you can afford, you can submit an offer on a property faster so you don’t miss out on the right tract, and it gives your offer more weight because it shows that you’re serious about purchasing.


Choose a USDA Loan question below

What is the maximum loan amount of a USDA home loan?

 USDA does not have a maximum loan amount. If a borrower can meet the debt-to-income requirements and the household income requirements for a given property they can use the USDA loan to purchase it.

Do I have to be a first-time homebuyer to get a USDA mortgage?

 No, you do not need to be a first-time homebuyer to obtain a USDA mortgage. However, the USDA loan product does not typically allow a homebuyer to have move than one home. Buyers must sell their current home before purchasing a new home using the USDA loan program.

What types of properties can be purchased with a USDA Loan?

 Single family residence, townhomes, bank owned or foreclosed properties all qualify for a USDA loan.

Does a home buyer have mortgage insurance with the USDA loan?

 The USDA home loan has its version of mortgage insurance and called a Guarantee Fee that consists of two parts: an upfront guarantee fee and an annual fee that serves as the monthly mortgage insurance premium for this loan type. The up-front guarantee fee of 1% is added to the loan. There is also a yearly fee that is paid monthly. The yearly fee is .35% and it’s added to the payment monthly.

How can I determine if the home I want to purchase is in a USDA qualifying area?

 You can use the USDA eligibility map to determine qualifying areas. Homebuyers can search a specific address or they can do a broader search for certain areas.

Visit USDA Eligibility Site

Can I put money down on a Georgia USDA mortgage?

 Yes, homebuyers can put money down when using the USDA mortgage as their financing. This can help lower the monthly payments. There is a USDA guideline that says if a borrower has enough to put at least 20% down they may not be eligible to obtain a USDA mortgage.

What are the USDA household income limits?

 The USDA home loan has a qualification requirement that is called household income limits. By definition, the USDA loan is designed for low to moderate-income households. The household income limit will vary from state to state and county to county but must not exceed the median household income for the area by more than 15 percent. Household size is also taken in account. Ask one of our Mortgage Representatives for specific details regarding income limits in the area you are considering.

VA Loan

Choose a VA Loan question below

What is a VA loan?

 A VA loan is a mortgage guaranteed by the U.S. Department of Veterans Affairs (VA) offered to qualified U.S. veterans, active-duty military personnel and some surviving spouses.

Who is eligible for a VA loan?

 You have served 90 consecutive days of active service during wartime, OR You have served 181 days of active service during peacetime, OR You have 6 years of service in the National Guard or Reserves, OR You are the spouse of a service member who has died in the line of duty or as a result of a service-related disability. Don’t meet these requirements? You may still be eligible: Talk with a Mortgage Representative today at 770.719.1111.

What is a COE?

 A COE is a form provided by the Department of Veterans Affairs that indicates to the lender that you’re eligible for a VA loan.

What types of properties can be purchased with a VA Loan?

 Qualifying properties include an existing home, a townhouse or condominium unit in a project that has been approved by the VA and a multi-unit property (up to a four-plex), provided you occupy one of the units as your primary residence.

How many times can you use a VA loan benefit?

 After using a VA mortgage to purchase a home, you can get another VA loan if:

  • You sell the house and pay off the VA loan.
  • You sell the house, and a qualified veteran buyer agrees to assume the VA loan.
  • You repay the VA loan in full and keep the house. For one time only, you can get another VA loan to purchase an additional home as your primary residence.